Turnover tax liability for buying commission agents cannot be reduced by rule-based deductions when section 6-B applies.

Buying commission agents acting for outside principals are liable to turnover tax under section 6-B of the Karnataka Sales Tax Act, 1957, because the Court held that "total turnover" for that levy must be read with section 2(u-2), not by importing the computation method in rule 6. Rules cannot override the Act, and deductions or exemptions available under other provisions do not reduce liability under section 6-B unless expressly permitted. The issue was therefore answered against the assessee and in favour of the Revenue.

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Issues: Whether buying commission agents acting for outside principals are liable to turnover tax under section 6-B of the Karnataka Sales Tax Act, 1957, and whether deductions under rule 6 of the Karnataka Sales Tax Rules, 1957 can be applied while computing total turnover for that purpose.

Analysis: Section 11(1) of the Act expressly provides that a person buying or selling on behalf of a principal resident in Karnataka is liable to be assessed to tax notwithstanding that the principal is not a dealer or that the turnover is below the prescribed minimum, and the provision is made subject only to the limited exceptions stated therein. The Court followed the earlier Division Bench decisions and the later decision in Jain Industrial Corporation, holding that the expression "total turnover" for section 6-B must be understood with reference to section 2(u-2) of the Act, not by importing the computation method under rule 6. The Court further held that rules cannot override the Act, and that exemptions or deductions available under other provisions do not affect liability under section 6-B because the Legislature has specifically excluded such deductions except those expressly provided.

Conclusion: Buying commission agents for outside principals are liable to turnover tax under section 6-B, and deductions under rule 6 cannot be pressed into service for computing total turnover for that levy. The issue is answered against the assessee and in favour of the Revenue.

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